YouTube Is 10 Times More Important Than Gmail For Google Stock

Google's stock is primarily driven by the company's search advertising business which we estimate to constitute about 68% of the $705 Trefis price estimate for Google's stock. In comparison, YouTube constitutes about 3% of Google's stock and Gmail only about 0.3%. YouTube is ten times more important than Gmail for Google's stock primarily due to the much higher revenue per page view on YouTube.

High YouTube Revenue Per Page View

Internet stocks like Google, Yahoo and AOL are highly dependent on both search and display advertising rates. Revenue per page view (RPM) is an important metric for internet stocks that measures how much ad revenue is generated on average for every 1,000 page views.

For YouTube, we estimate that revenue per 1,000 page views increased from about 40 cents in 2005 to about $2.40 in 2009. We expect YouTube's revenue per 1,000 page views to increase to nearly $10 by the end of the Trefis forecast period. You can see our full forecast for YouTube RPM below.

In comparison, we estimate that Gmail had revenue per 1,000 page views of 6 cents in 2005 which increased to about 30 cents in 2009. We expect Gmail's revenue per 1,000 page views to increase to 62 cents by the end of the Trefis forecast period. You can see our full forecast for Gmail RPM below.